What to Expect When Broadcom Reports After the Close

By Chris Lange Updated Mar 13, 10:14PM EDT · Published Sep 12, 11:35AM EDT

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What to Expect When Broadcom Reports After the Close — © Thinkstock

Broadcom Inc. (NASDAQ: AVGO | AVGO Price Prediction) is scheduled to release its fiscal third-quarter financial results after the markets close on Thursday. The consensus estimates call for $5.13 in earnings per share (EPS) and $5.54 billion in revenue, up from the $4.98 per share and $5.07 billion posted in the same period of last year.

Some mergers are never formally consummated and never formally ended, as far as a lack of corporate communications is concerned. The would-be acquisition of Symantec by Broadcom was one of those deals that was not formally on the table, and it remains to be seen whether the companies issue that press release.

While multiple media and analyst reports had discussed an acquisition of Symantec Corp. (NASDAQ: SYMC), Broadcom’s hopes of acquiring the company appear to be dashed. CNBC reported in July that these two technology companies have ceased merger negotiations. Symantec would not accept a buyout of less than $28 per share, according to CNBC.

As for the price of the deal, it would have valued Symantec at just over $17 billion. A report from Jefferies in the prior week valued Symantec at about $24 per share. At roughly the same time, Wedbush Securities said that it believed that $26 to $28 per share would be the sweet spot range in which a deal likely would have been consummated.

Broadcom is lucky this deal is off the table. By making a diversification acquisition of CA already, the company’s organic growth looks like it may have peaked. After all, we are talking about the company that is already the merger of Broadcom and Avago. It also was among the companies laying off the most workers in 2018.

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Excluding Thursday’s move, Broadcom had underperformed the broad markets, with its stock up 17% year to date. In the past 52 weeks, the stock was up 24%.

A few analysts weighed in on Broadcom ahead of the report:

Susquehanna Bancshares has a Buy rating and a $315 price target.
Cascend Securities has a Buy rating with a $330 price target.
Loop Capital has a Buy rating with a $310 target price.
Daiwa Capital Markets has a Neutral rating.
Mizuho’s Buy rating comes with a $330 target price.
KeyCorp has an Overweight rating with a $330 price target.

Shares of Broadcom traded up marginally at $300.50 on Thursday, with a 52-week range of $208.23 to $323.20. The consensus price target is $307.08.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.